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This command line creates a new user with home directory, using the command "useradd". The command "mkpasswd" lets you encrypt the password e.g. with SHA-512 method. This line ensures that your password is written encrypted in /etc/shadow" so you can log in with the new user.

The crypt function takes a password, key, as a string, and a salt character array which is described below, and returns a printable ASCII string which starts with another salt. It is believed that, given the output of the function, the best way to find a key that will produce that output is to guess values of key until the original value of key is found.

The crypt function takes a password, key, as a string, and a salt character array which is described below, and returns a printable ASCII string which starts with another salt. It is believed that, given the output of the function, the best way to find a key that will produce that output is to guess values of key until the original value of key is found.

The salt parameter does two things. Firstly, it selects which algorithm is used, the MD5-based one or the DES-based one. Secondly, it makes life harder for someone trying to guess passwords against a file containing many passwords; without a salt, an intruder can make a guess, run crypt on it once, and compare the result with all the passwords. With a salt, the intruder must run crypt once for each different salt.

For the MD5-based algorithm, the salt should consist of the string $1$, followed by up to 8 characters, terminated by either another $ or the end of the string. The result of crypt will be the salt, followed by a $ if the salt didn't end with one, followed by 22 characters from the alphabet ./0-9A-Za-z, up to 34 characters total. Every character in the key is significant.

For the DES-based algorithm, the salt should consist of two characters from the alphabet ./0-9A-Za-z, and the result of crypt will be those two characters followed by 11 more from the same alphabet, 13 in total. Only the first 8 characters in the key are significant.

This command is a bit Linux specific, as --stdin doesn't exist for passwd on many Unix machines. Further, useradd is high level in most distributions and Unix derivatives except for the Debian family of distros, where adduser would be more appropriate. The last bit, with chage, will force the user to change their password on new login.